Petrobras FCPA Bribery Scandal: Energy Giant Pays $853.2M
Petrobras, a Brazilian state-owned and state-controlled energy company, entered into agreements with U.S. and Brazilian authorities and agreed to pay a combined total of $853.2 million in penalties to resolve the U.S. government’s investigation into violations of the Foreign Corrupt Practices Act (FCPA) in connection with Petrobras’s role in facilitating payments to politicians and political parties in Brazil.
According to the U.S. government, executives at the highest levels of Petrobras—including members of its Executive Board and Board of Directors—facilitated the payment of hundreds of millions of dollars in bribes to Brazilian politicians and political parties and then cooked the books to conceal the bribe payments from investors and regulators.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney G. Zachary Terwilliger of the Eastern District of Virginia, and Assistant Director Robert Johnson of the FBI’s Criminal Investigative Division made the announcement.
“Executives at the highest levels of Petrobras—including members of its Executive Board and Board of Directors—facilitated the payment of hundreds of millions of dollars in bribes to Brazilian politicians and political parties and then cooked the books to conceal the bribe payments from investors and regulators,” said Assistant Attorney General Benczkowski. “The Criminal Division’s Fraud Section—together with our partners in the Eastern District of Virginia, the SEC, and the FBI—are grateful for the assistance provided by our Brazilian law enforcement counterparts. This case is just the most recent example of our ability to work with our foreign counterparts to investigate companies and other criminal actors whose conduct spans multiple international jurisdictions.”
“Protecting the integrity of U.S. financial markets is one of the highest priorities of this Administration,” said U.S. Attorney Terwilliger. “Those who choose to access our capital markets while failing to disclose the corrupt activities of company executives will be held accountable. I want to thank our law enforcement partners for their diligence and dedication in pursuing this important case.”
Petrobras’s admissions reveal that while the company’s American Depository Shares traded on the New York Stock Exchange, members of the Petrobras Executive Board were involved in facilitating and directing millions of dollars in corrupt payments to politicians and political parties in Brazil. Members of Petrobras’s Board of Directors were also involved in facilitating bribes that a major Petrobras contractor was paying to Brazilian politicians.
The hefty $853.2 million criminal penalty should act as a deterrent to anyone seeking to perpetrate this kind of fraud in the future, according to FBI Assistant Director Johnson. “Today’s global resolution demonstrates the FBI’s commitment to thoroughly investigating and holding accountable those international companies who seek to take advantage of our financial system while also facilitating bribes and fraud in other countries,” he said.
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Key Facts
- State: Federal
- Category: Public Corruption|White Collar Crime|Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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